Contrary to the general belief we are in recovery from the black plague of recession, UK debt & deficits continue to spiral at alarming rates.
Debt to put it simply is the amount of money owed by the UK government. This is the debt run up over many years and successive governments. An easy way to express debt levels across various nations is to compare it to the country’s output i.e. the Gross Domestic Product (GDP). The debt to GDP ratio of Britain currently stands around a towering 90%. Many may find shocking that UK debt is nine-tenths of it’s outputs.
Should economic trends and forecasts be adhered to, this trend is not one due to end. Indeed, UK debt is forecasted to keep scaling for quite a number of years.
The UK deficit refers to the shortfall in the Government bank balance when revenues and expenses are compared. Should revenues overcome expenses, you have a surplus. In recent history, the government has spent quite a bit in excess of what it receives, so budget deficits are a very contemporary & prevailing issue.
Obviously, debts & deficits are in direct relation to one another. If the government continues to overspend, which it has, it usually adds to escalating debts.
How to tackle a budget deficit? Borrowing. The British government is particularly adept at this and have been borrowing relentlessly to stop the budget deficit gap.
Britain is undergoing a jobs rich but cash poor recovery from recession. This means that while hundreds of thousands of positions may have been created, they are generally in low paid sectors, meaning wage stagnation is keeping income tax low.
UK households owe on average £9,000 just in personal loans such as credit card debt & overdraft, according to research conduct by PwC. The same research showed worrying levels of financial illiteracy, where just 21% of those surveyed correctly understood the cost of a mortgage. Record low-interest rates are helping the stem the tide of financial ruin for many, but just a 2% rise in interest rates would leave many families scrambling to pay the debt shortfall.
Rescue my Properties are the first emergency service for distressed buy to let mortgages in the UK. With over a decade unrivalled specialised experience, we have been on the ground tackling the harrowing issue of debt. We can expertly negotiate & consolidate debt, including property portfolio’s & personal deficits. We take an individual approach to each client to see the person behind the problem. Our aim is not just to get our clients to a debt free future, but to alleviate the worry associated with the debt for a stress free fresh start. Call today for a free one hour consultation. The only thing you have to lose is the debt!
0207 7127 6536